EXHIBIT 3.2

                             BY-LAWS OF TEXACO INC.
                             A Delaware Corporation

                                   ARTICLE I.
                                  Stockholders.

     SECTION 1. Annual Meeting. The annual meeting of stockholders shall be held
on the fourth Tuesday in April of each year at 2:00 P.M., or at such time of day
or on such  other  date in each  calendar  year as may be fixed by the  Board of
Directors,  for the  election  of  directors  and the  transaction  of any other
business as may properly come before the meeting.
     SECTION 2. Stockholder  Action;  Special  Meetings.  Any action required or
permitted to be taken by the  stockholders  of the Company must be effected at a
duly called annual or special meeting of such holders and may not be effected by
any consent in writing by such holders.  Except as otherwise required by law and
subject  to the rights of the  holders of any class or series of stock  having a
preference  over the Common Stock as to dividends or upon  liquidation,  special
meetings  of  stockholders  of the  Company  may be called  only by the Board of
Directors pursuant to a resolution approved by a majority of the entire Board of
Directors.
     SECTION 3.  Notice of  Meetings.  Notice of each  meeting of  stockholders,
annual or special,  stating the time and place,  and, if a special meeting,  the
purpose or purposes in general  terms,  shall be mailed no earlier  than 60 days
and no  later  than 10 days  prior to the  meeting  to each  stockholder  at the
stockholder's address as the same appears on the books of the Company.
     SECTION 4. Place.  Meetings of the stockholders shall be held at such place
or places as the Board of Directors may direct, the place to be specified in the
notice.
     SECTION  5.  Quorum.  At any  meeting  of  stockholders,  the  holders of a
majority of the voting shares issued and outstanding, being present in person or
represented by proxy, shall be a quorum for all purposes, except where otherwise
provided by statute.
     SECTION 6. Adjournments. Any annual or special meeting of stockholders duly
and regularly  called in  accordance  with these by-laws may adjourn one or more
times and no  further  notice of such  adjourned  meeting or  meetings  shall be
necessary.  The chairman of any meeting of stockholders  shall have the power to
adjourn  the  meeting  to another  date,  time and place.  Any  business  may be
transacted  at any such  adjourned  meeting or  meetings  which  might have been
transacted at the meeting as originally called.
     SECTION 7. Organization. The Chairman of the Board, or, in his absence, the
Vice Chairman, or, in their absence, the President, or, in their absence, one of
the Executive  Vice  Presidents,  or, in their  absence,  one of the Senior Vice
Presidents,   or,  in  their  absence,   a  Vice  President   appointed  by  the
stockholders,  shall call meetings of the stockholders to order and shall act as
chairman  thereof.  The  Secretary  of the  Company,  if  present,  shall act as
secretary  of all  meetings  of the  stockholders;  and,  in  his  absence,  the
presiding officer may appoint a secretary.
     SECTION 8. Voting. At each meeting of the  stockholders,  every stockholder
of record (at the closing of the transfer  books if closed) shall be entitled to
vote in person or by proxy  appointed by an instrument in writing  subscribed by
such  stockholder or by his duly authorized  attorney and delivered to and filed
with the Secretary at the meeting;  and each stockholder shall have one vote for
each share of stock  standing in his name.  Voting for  directors,  and upon any
question at any meeting, shall be by ballot, if demanded by any stockholder.
     SECTION 9. Stockholder Proposals.  Stockholders may present proper business
for  stockholder  action at an annual meeting by giving timely notice in writing
to the Secretary of their  intention to bring such business  before the meeting.
To be  timely,  a  stockholder's  notice  must be  delivered  to, or mailed  and
received at, the office of the Company in Harrison,  New York,  addressed to the
attention of the Secretary, not less than 60 days nor more than 90 days prior to
the first  anniversary of the preceding  year's annual meeting of  stockholders;
provided,  however, that if the date of the annual meeting is advanced more than
30 days prior to or delayed  by more than 60 days after such  anniversary  date,
notice by the stockholder to be timely must be so delivered not earlier than the
90th day prior to such  annual  meeting and not later than the close of business
on the  later of the  60th day  prior  to such  annual  meeting  or the 10th day
following  the day on which public  announcement  of the date of such meeting is
first made. The stockholder's notice shall set forth (a) the name and address of
the stockholder proposing such business, (b) a brief description of the business
desired to be brought  before the  meeting  and any  material  interest  in such
business of such stockholder,  and (c) the number of shares of the Company which
are  beneficially  owned by the  stockholder.  The  chairman  of the meeting may
refuse to permit  any  business  to be  brought  before an annual  meeting  by a
stockholder without compliance with the procedure set forth in this Section 9.
     For purposes of this section,  "public  announcement" shall mean disclosure
in a press release reported by the Dow Jones News Service, Associated Press or a
comparable  national news service or in a document publicly filed by the Company
with the Securities and Exchange Commission.

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     Notwithstanding  the  foregoing  provisions  of this by-law,  a stockholder
shall also comply with all applicable  requirements  of the Securities  Exchange
Act of 1934,  as  amended  (the  "Exchange  Act") and the rules and  regulations
thereunder  with  respect to matters set forth in this  by-law.  Nothing in this
by-law shall be deemed to affect any rights of stockholders to request inclusion
of proposals in the company's proxy  statement  pursuant to Rule 14a-8 under the
Exchange Act.
     SECTION 10. List of  Stockholders.  The  Secretary  shall keep records from
which a list of stockholders  can be compiled,  and shall furnish such list upon
order of the Board of Directors.

                                   ARTICLE II.
                             The Board of Directors.

     SECTION 1.  Number,  Election and Terms.  Except as  otherwise  fixed by or
pursuant to the  provisions of Article IV of the  Certificate  of  Incorporation
relating to the rights of the  holders of any class or series of stock  having a
preference  over the Common Stock as to dividends or upon  liquidation  to elect
additional directors under specified circumstances,  the number of the directors
of the Company  shall be fixed from time to time by the Board of  Directors  but
shall not be less than three. The directors, other than those who may be elected
by the  holders  of any class or series of stock  having a  preference  over the
Common Stock as to  dividends or upon  liquidation,  shall be  classified,  with
respect to the time for which they severally hold office, into three classes, as
nearly equal in number as possible, as determined by the Board of Directors, one
class to be  originally  elected for a term  expiring  at the annual  meeting of
stockholders  to be held in 1985,  another class to be originally  elected for a
term  expiring at the annual  meeting of  stockholders  to be held in 1986,  and
another class to be originally elected for a term expiring at the annual meeting
of  stockholders  to be held in 1987,  with each class to hold office  until its
successor is elected and qualified.  At each annual meeting of the  stockholders
of the Company,  the successors of the class of directors  whose term expires at
that meeting  shall be elected to hold office for a term  expiring at the annual
meeting  of  stockholders  held in the third  year  following  the year of their
election.
     SECTION 2. Newly Created  Directorships and Vacancies.  Except as otherwise
provided  for or fixed by or  pursuant  to the  provisions  of Article IV of the
Certificate of Incorporation  relating to the rights of the holders of any class
or series of stock having a preference  over the Common Stock as to dividends or
upon liquidation to elect directors under specified circumstances, newly created
directorships  resulting  from any  increases  in the number of directors or any
vacancies  on the  Board of  Directors  resulting  from  death,  resignation  or
disqualification,  or other cause shall be filled by the  affirmative  vote of a
majority  of the  remaining  directors  then in office,  even though less than a
quorum of the Board of  Directors.  Any  director  so  elected  shall  stand for
election  (for  the  balance  of  his  term)  at  the  next  annual  meeting  of
stockholders, unless his term expires at such Annual Meeting. Any vacancy on the
Board of Directors  resulting from removal by  stockholder  vote shall be filled
only by the vote of a majority of the voting  power of all shares of the Company
entitled to vote  generally in the election of Directors,  voting  together as a
single class.  The affirmative vote of the holders of at least a majority of the
then outstanding  shares of capital stock of the Company voting generally in the
election of Directors,  voting together as a single class,  shall be required to
repeal the foregoing provisions.
     SECTION 3.  Removal.  Subject to the rights of any class or series of stock
having a preference over the Common Stock as to dividends or upon liquidation to
elect Directors under specified circumstances,  any director may be removed from
office,  with or without cause,  only by the affirmative  vote of the holders of
66 2/3% of the combined  voting  power of the then  outstanding  shares of stock
entitled to vote  generally in the election of Directors,  voting  together as a
single class.
     SECTION  4.  Nominations.  Subject to the rights of holders of any class or
series of stock  having a  preference  over the Common  Stock as to dividends or
upon  liquidation,  nominations for the election of Directors may be made by the
Board of Directors or a proxy  committee  appointed by the Board of Directors or
by any  stockholder  entitled to vote in the  election of  Directors  generally.
However, any stockholder entitled to vote in the election of Directors generally
may  nominate one or more persons for election as Directors at a meeting only if
written  notice  of  such  stockholder's  intent  to  make  such  nomination  or
nominations  has been  given,  either by personal  delivery or by United  States
mail,  postage prepaid,  to the Secretary of the Company not later than (i) with
respect to an election to be held at an annual meeting of stockholders,  90 days
in advance of such meeting, and (ii) with respect to an election to be held at a
special  meeting of  stockholders  for the election of  Directors,  the close of
business on the seventh day  following  the date on which notice of such meeting
is first given to  stockholders.  Each such notice shall set forth: (a) the name
and address of the  stockholder  who intends to make the  nomination  and of the
person or persons to be nominated;  (b) a representation that the stockholder is
a holder of record of stock of the Company  entitled to vote at such meeting and
intends to appear in person or by proxy at the meeting to nominate the person or
persons  specified  in the notice;  (c) a  description  of all  arrangements  or
understandings  between the stockholder and each nominee and any other person or
persons  (naming  such person or persons)  pursuant to which the  nomination  or
nominations  are to be made  by the  stockholder;  (d)  such  other  information
regarding each nominee  proposed by such  stockholder as would be required to be
included  in a  proxy  statement  filed  pursuant  to  the  proxy  rules  of the
Securities and Exchange Commission,  had the nominee

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been nominated, or intended to be nominated, by the Board of Directors;  and (e)
the consent of each nominee to serve as a director of the Company if so elected.
The  chairman of the meeting may refuse to  acknowledge  the  nomination  of any
person not made in compliance with the foregoing procedure.
     SECTION 5.  Organization  Meeting of the Board. At the last regular meeting
of the Board of  Directors  prior to each annual  meeting of  stockholders,  the
Board of Directors shall establish its organization,  elect and appoint officers
and appoint  committee  members.  Such action may also be taken at another place
and time fixed by written consent of the Directors.
     SECTION 6. Regular  Meetings.  Regular  meetings of the Board are fixed and
may be held without notice at the office of the Company in Harrison, New York on
the fourth  Friday in each month at 9:00 A.M.,  or at such other time and place,
either  within or without  the State of  Delaware,  as the Board may  provide by
resolution,  without other notice than such resolution. If less than a quorum is
present at any meeting  time and place,  those  present may adjourn from time to
time until a quorum  shall be present,  but if there shall be no quorum prior to
another  regular meeting time, then such meetings of less than a quorum need not
be recorded.
     SECTION 7. Special  Meetings.  Special  meetings of the Board shall be held
whenever  called by the Chairman of the Board,  or, in his absence,  by the Vice
Chairman of the Board, or, in their absence,  by the President,  or by one-third
of the  Directors  then in  office.  The person or  persons  authorized  to call
special  meetings of the Board may fix any place,  either  within or without the
State of  Delaware,  as the  place  for  holding  any  special  meeting.  Unless
otherwise  specified in the notice thereof,  any business may be transacted at a
special meeting.
     SECTION 8. Notice of Special  Meetings.  The  Secretary  shall mail to each
director notice of any special meeting at least two days before the meeting,  or
shall  telegraph  or  telephone  such  notice  not later than the day before the
meeting.  When all Directors are present, any business may be transacted without
any previous notice. Any director may waive notice of any meeting.
     SECTION 9. Quorum. A majority of the total number of Directors,  or half of
the total  number  when the number of  Directors  then in office is even,  shall
constitute a quorum for the  transaction  of  business,  and a majority of those
present at the time and place of any regular or special  meeting,  although less
than a quorum,  may  adjourn  the same from time to time,  as  provided in these
by-laws.
     SECTION 10.  Chairman.  At all  meetings of the Board,  the Chairman of the
Board, or, in his absence, the Vice Chairman of the Board, or, in their absence,
the President, or, in their absence, a chairman chosen by the Directors present,
shall preside.
     SECTION 11. Action without Meeting.  A statement in writing,  signed by all
members of the Board of Directors or the Executive Committee, shall be deemed to
be action by the Board or Committee,  as the case may be, to the effect  therein
expressed, and it shall be the duty of the Secretary to record such statement in
the minute books of the Company under its proper date.

                                  ARTICLE III.
                    Executive Committee and Other Committees.

     SECTION 1.  Executive  Committee.  The Board of Directors  shall appoint an
Executive Committee of seven or more members to serve during the pleasure of the
Board to consist of the Chairman of the Executive Committee, the Chairman of the
Board,  the Vice  Chairman  of the Board,  the  President,  and such  additional
Directors as the Board may from time to time designate.
     SECTION 2. The  Chairman of the  Executive  Committee.  The Chairman of the
Executive Committee shall be designated by the Board of Directors and shall be a
member of the Board and of the Executive Committee. He shall preside at meetings
of the  Executive  Committee,  and shall do and perform such other things as may
from time to time by assigned to him by the Board of Directors.
     SECTION 3.  Vacancies. Vacancies in the Executive Committee shall be filled
by the Board.
     SECTION  4.  Executive  Committee  to Report.  All action by the  Executive
Committee  shall be  reported  promptly  to the Board and such  action  shall be
subject to review by the Board,  provided  that no rights of third parties shall
be affected by such review.
     SECTION 5. Procedure.  The Executive Committee,  by a vote of a majority of
all of its  members,  shall  fix its own  times and  places  of  meeting,  shall
determine the number of its members constituting a quorum for the transaction of
business,  and shall  prescribe its own rules of  procedure,  no change in which
shall be made save by a majority vote of all of its members.
     SECTION 6. Powers.  During the intervals between the meetings of the Board,
the  Executive  Committee  shall  possess and may exercise all the powers of the
Board in the  management  and  direction  of the  business  and  affairs  of the
Company,  except those which by applicable  statute are reserved to the Board of
Directors.
     SECTION 7. Other Committees.  From time to time the Board may appoint other
committees,  and  they  shall have such  powers as shall  be  specified  in  the
resolution of  appointment.

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                                   ARTICLE IV.
                                    Officers.

     SECTION  1.  Number.  The Board of  Directors  shall  elect  the  executive
officers of the Company  which may include a Chairman of the Board,  one or more
Vice Chairmen of the Board,  a President,  one or more Vice  Presidents  (one or
more of whom may be  designated as Executive  Vice  Presidents or as Senior Vice
Presidents  or by  other  designations),  a  General  Counsel,  a  Secretary,  a
Treasurer,  a Comptroller,  and a General Tax Counsel.  A person may at the same
time hold, exercise and perform the powers and duties of more than one executive
officer position.  In addition to the executive officers,  the Board may appoint
one  or  more  Assistant   Secretaries,   Assistant   Treasurers  and  Assistant
Comptrollers  and such  other  officers  or agents as the Board may from time to
time deem  necessary or  desirable.  All  officers and agents shall  perform the
duties and exercise the powers usually incident to the offices or positions held
by them, those prescribed by these by-laws, and those assigned to them from time
to time by the Board or by the Chief Executive Officer.
     SECTION 2. The Chairman of the Board.  The Chairman of the Board shall be a
member  of the  Board of  Directors  and of the  Executive  Committee.  He shall
preside at meetings of the stockholders and of the Directors,  and shall keep in
close touch with the administration of the affairs of the Company,  shall advise
and  counsel  with the Vice  Chairman of the Board and the  President,  and with
other  executives  of the Company and shall do and perform  such other duties as
may from time to time be  assigned  to him by the Board of  Directors  or by the
Executive Committee.
     SECTION 3. The Vice  Chairman of the Board.  The Vice Chairman of the Board
shall be a member of the Board of  Directors  and the  Executive  Committee.  He
shall keep in close touch with the administration of the affairs of the Company,
shall advise and counsel with the Chairman of the Board and the  President,  and
with other executives of the Company, and shall do and perform such other duties
as may from time to time be  assigned  to him by the Board of  Directors  or the
Executive Committee.
     SECTION 4. The President.  The President  shall be a member of the Board of
Directors and of the Executive Committee.  He shall keep in close touch with the
administration of the affairs of the Company,  shall advise and counsel with the
Chairman  of the  Board  and the Vice  Chairman  of the  Board  and  with  other
executives  of the  Company,  and shall do and perform  such other duties as may
from time to time be assigned to him by the Board of Directors or the  Executive
Committee.  In the  absence of the  Chairman of the Board,  he shall  preside at
meetings of the stockholders and of the Directors.
     SECTION 5. The Chief Executive  Officer.  Either the Chairman of the Board,
or the President,  as the Board of Directors may  designate,  shall be the Chief
Executive  Officer of the  Company.  The officer so  designated  shall have,  in
addition to the powers and duties  applicable  to the office set forth in either
Section 2 or 4 of this Article IV, general active  supervision over the business
and affairs of the Company and over its several officers, agents, and employees,
subject,  however,  to the  direction  and control of the Board or the Executive
Committee. The Chief Executive Officer shall see that all orders and resolutions
of the Board or the  Executive  Committee  are  carried  into  effect,  and,  in
general,  shall perform all duties  incident to the position of Chief  Executive
Officer and such other  duties as may from time to time be assigned by the Board
or the Executive Committee.
     SECTION 6. The Executive Vice  Presidents.  The Executive  Vice  Presidents
shall keep in touch with the administration of the affairs of the Company, shall
advise and  counsel  with the  Chairman of the Board,  the Vice  Chairman of the
Board and with the President and with other executives of the Company, and shall
do and perform such other duties as from time to time may be assigned to them by
the Board of Directors,  the Executive Committee, the Chairman of the Board, the
Vice Chairman of the Board, or the President.  In the absence of the Chairman of
the  Board,  the Vice  Chairman  of the  Board  and the  President,  the  senior
Executive Vice President shall preside at meetings of the stockholders.
     SECTION 7. The Senior Vice  Presidents.  Each Senior Vice  President  shall
have such powers as may be  conferred  upon him by the Board of  Directors,  and
shall  perform  such  duties as from time to time may be  assigned to him by the
Board of Directors, the Executive Committee, the Chairman of the Board, the Vice
Chairman of the Board, or the President.
     SECTION 8. The Vice Presidents.  Each Vice President shall have such powers
as may be conferred  upon him by the Board of Directors,  and shall perform such
duties as from time to time may be  assigned  to him by the Board of  Directors,
the  Executive  Committee,  the Chairman of the Board,  the Vice Chairman of the
Board, or the President.
     SECTION 9. The General  Counsel.  The General Counsel shall have charge  of
all the legal affairs of the Company and  shall  exercise  supervision  over its
contract relations.
     SECTION  10. The  Secretary.  The  Secretary  shall keep the minutes of all
meetings of the  stockholders  and the Board of Directors in books  provided for
the  purpose.  He shall  attend to the giving and serving of all notices for the
Company.  He shall sign with the Chairman of the Board, the Vice Chairman of the
Board, the President,  and Executive Vice President, a Senior Vice President, or
a Vice  President,  such  contracts as may require his  signature,  and shall in
proper cases affix the seal of the Company thereto.  He shall have charge of the
certificate

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<PAGE>

books and such other books and papers as the Board of Directors  may direct.  He
shall sign with the Chairman of the Board,  the  President,  or a Vice President
certificates  of stock,  and he shall in general perform all the duties incident
to the  Office of  Secretary,  subject to the  control  of the Board,  and shall
perform  such other  duties as from time to time may be  assigned  to him by the
Board of Directors, the Executive Committee, the Chairman of the Board, the Vice
Chairman of the Board, or the President. Any Assistant Secretary may, in his own
name,  perform any duty of the Secretary,  when so requested by the Secretary or
in the absence of that officer, and may perform such duties as may be prescribed
by the Board. In the absence of the Secretary and of all Assistant  Secretaries,
minutes of any meetings may be kept by a Secretary  pro tem,  appointed for that
purpose by the presiding officer.
     SECTION 11. The Treasurer.  The Treasurer  shall have charge and custody of
and be  responsible  for all the funds and  securities  of the Company,  and may
invest  the  same  in any  securities  as may be  permitted  by  law;  designate
depositories  in which all  monies  and  other  valuables  to the  credit of the
Company may be deposited;  render to the Board,  or any committee  designated by
the Board,  whenever the Board or such committee may require,  an account of all
transactions  as Treasurer;  and in general perform all the duties of the office
of  Treasurer  and such other duties as from time to time may be assigned by the
Chairman  of the Board,  the Vice  Chairman  of the Board,  the  President,  the
officer of the Company who may be designated  Chief Financial  Officer,  and the
Board of Directors.  In case one or more Assistant Treasurers be appointed,  the
Treasurer  may  delegate  to them the  authority  to perform  such duties as the
Treasurer may determine.
     SECTION  12.  The  Comptroller.  The  Comptroller  shall  be the  principal
accounting officer of the corporation;  shall have charge of the Company's books
of accounts,  records and  auditing,  shall ensure that the  necessary  internal
controls  exist  within the  Company to provide  reasonable  assurance  that the
Company's  assets are safeguarded and that financial  records are maintained and
publicly disclosed in accordance with generally accepted accounting  principles;
and in general  perform all the duties incident to the office of Comptroller and
such other  duties as from time to time may be assigned  by the  Chairman of the
Board, the Vice Chairman of the Board, the President, the officer of the Company
who may be designated Chief Financial  Officer,  and the Board of Directors.  In
case one or more  Assistant  Comptrollers  be  appointed,  the  Comptroller  may
delegate to them such duties as the Comptroller may determine.
     SECTION 13.  The General Tax Counsel. The General  Tax  Counsel shall  have
charge of all the tax affairs of the Company.
     SECTION 14. Tenure of Officers:  Removal. All officers elected or appointed
by the Board shall hold office until their successor is elected or appointed and
qualified,  or until their earlier  resignation  or removal.  All  such officers
shall  be  subject  to  removal,  with  or  without  cause,  at any  time by the
affirmative vote of a majority of the whole Board.

                                   ARTICLE V.
                                Indemnification.

     SECTION 1. Right to  Indemnification.  The Company shall indemnify,  defend
and hold harmless any person who was or is a party or is threatened to be made a
party to any  threatened,  pending  or  completed  action,  suit or  proceeding,
whether  civil,  criminal,  administrative,  investigative  or other,  including
appeals, by reason of the fact that he is or was a director, officer or employee
of the  Company,  or is or  was  serving  at the  request  of the  Company  as a
director,  officer or employee of any corporation,  partnership,  joint venture,
trust or other  enterprise,  including  service with respect to employee benefit
plans,  whether the basis of such  proceeding  is alleged  action in an official
capacity as a  director,  officer or  employee  or in any other  capacity  while
serving as a director,  officer or employee, to the fullest extent authorized by
the Delaware  General  Corporation  Law, as the same exists or may  hereafter be
amended,  (but, in the case of any such amendment,  only to the extent that such
amendment  permits the Company to provide  broader  indemnification  rights than
said Law permitted the Company to provide prior to such  amendment)  against all
expenses, liability and loss (including attorneys' fees, judgments, fines, ERISA
excise  taxes  or  penalties  and  amounts  paid or to be  paid  in  settlement)
reasonably  incurred  or  suffered  by  such  person  in  connection  therewith;
provided,  however,  that except as provided in Section 2 hereof with respect to
proceedings  seeking to enforce  rights to  indemnification,  the Company  shall
indemnify  any  such  person  seeking   indemnification  in  connection  with  a
proceeding (or part thereof) initiated by such person only if the proceeding (or
part thereof) was authorized by the Board of Directors of the Company.
     The right to indemnification  conferred in this Article shall be a contract
right and shall include the right to be paid by the Company expenses incurred in
defending  any such  proceeding in advance of its final  disposition;  provided,
however,  the payment of such  expenses in advance of the final  disposition  of
such  proceeding  shall  be  made  only  upon  delivery  to  the  Company  of an
undertaking by or on behalf of such  director,  officer or employee to repay all
amounts so advanced if it should be determined  ultimately that such director or
officer or employee  is not  entitled to be  indemnified  under this  Article or
otherwise.
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     "Employee."  as used  herein,  includes  both  an  active  employee  in the
Company's  service as well as a retired employee who is or has been a party to a
written  agreement  under  which he might be, or might  have been  obligated  to
render services to the Company.
     SECTION 2. Right of Claimant to Bring Suit.  If a claim under  Section 1 is
not paid in full by the  Company  within  sixty days or, in cases of advances of
expenses,  twenty days,  after a written claim has been received by the Company,
the  claimant  may at any time  thereafter  bring suit  against  the  Company to
recover the unpaid  amount of the claim and, if  successful in whole or in part,
the claimant shall be entitled to be paid also the expense of  prosecuting  such
claim. It shall be a defense to any such action (other than an action brought to
enforce a claim for expenses  incurred in defending any proceeding in advance of
its final  disposition  where the required  undertaking has been tendered to the
Company)  that the claimant has not met the  standards of conduct  which make it
permissible  under the  Delaware  General  Corporation  Law for the  Company  to
indemnify  the claimant for the amount  claimed,  but the burden of proving such
defense shall be on the Company.  Neither the failure of the Company  (including
its Board of Directors,  independent legal counsel, or its stockholders) to have
made  a   determination   prior  to  the   commencement   of  such  action  that
indemnification of the claimant is proper in the circumstances because he or she
has met the  applicable  standard of conduct set forth in the  Delaware  General
Corporation Law, nor an actual determination by the Company (including its Board
of Directors,  independent legal counsel or its stockholders)  that the claimant
had not met such  applicable  standard  of  conduct,  shall be a defense  to the
action or create a presumption that claimant had not met the applicable standard
of conduct.  The Company  shall be  precluded  from  asserting  in any  judicial
proceeding   commenced   pursuant  to  this  Article  that  the  procedures  and
presumptions  of this Article are not valid,  binding and  enforceable and shall
stipulate in any such proceeding that the Company is bound by all the provisions
of this Article.
     SECTION 3.  Non-Exclusivity and Survival.  The right to indemnification and
the payment of expenses  incurred in  defending a  proceeding  in advance of its
final disposition conferred in this Article (a) shall apply to acts or omissions
antedating the adoption of this by-law, (b) shall be severable, (c) shall not be
exclusive of other rights to which any director,  officer or employee may now or
hereafter  be entitled,  (d) shall  continue as to a person who has ceased to be
such  director,  officer or  employee  and (e) shall inure to the benefit of the
heirs, executors and administrators of such a person.

                                   ARTICLE VI.
                                 Capital Stock.

     SECTION 1. Form and Execution of  Certificates.  The certificates of shares
of the capital  stock of the Company  shall be in such form as shall be approved
by the Board. The certificates shall be signed by the Chairman of the Board, the
President, or a Vice President, and the Secretary or an Assistant Secretary.
     Section 2. Certificates to be Entered.  Certificates shall be consecutively
numbered,  and the names of the  owners,  the  number of shares  and the date of
issue, shall be entered in the books of the Company.
     SECTION 3. Old  Certificates to be Canceled.  Except in the case of lost or
destroyed  certificates,  and  in  that  case  only  upon  performance  of  such
conditions as the Board may  prescribe,  no new  certificate  shall be issued in
lieu of a former  certificate  until  such  former  certificate  shall have been
surrendered and canceled.
     Section 4.  Transfer of Shares.  Shares  shall be  transferred  only on the
books of the Company by a holder thereof in person or by his attorney  appointed
in writing,  upon the  surrender and  cancellation  of  certificates  for a like
number of shares.
     SECTION 5.  Regulations.  The Board may make such rules and  regulations as
it may deem  expedient  concerning  the  issue,  transfer  and  registration  of
certificates of stock of the Company.
     Section 6. Registrar.  The Board, the Chairman of the Board, the President,
and the  Treasurer  shall  each have the  authority  to appoint a  registrar  of
transfers  and may  require  all  certificates  to bear  the  signature  of such
registrar.
     SECTION 7. Closing of Transfer Books. If deemed expedient by the Board, the
stock  books  and  transfer  books  may  be  closed  for  the  meetings  of  the
stockholders,  or for other  purposes,  during such periods as from time to time
may be  fixed  by  the  Board,  and  during  such  periods  no  stock  shall  be
transferable on said books.
     SECTION 8. Dates of Record. If deemed expedient by the Board, the Directors
may fix in advance,  a date,  not  exceeding 60 days  preceding  the date of any
meeting of stockholders or the date for the payment of any dividend, or the date
for the  allotment  of  rights,  or the date when any  change or  conversion  or
exchange  of  capital  stock  shall go into  effect,  as a  record  date for the
determination  of the  stockholders  entitled  to notice of, and to vote at, any
such meeting or entitled to receive payment of any such dividend, or to any such
allotment  of rights,  or to exercise  the rights in respect of any such change,
conversion or exchange of capital stock, and in such case only such stockholders
as shall be  stockholders  of record on the date so fixed  shall be  entitled to
such  notice of, and to vote at,  such  meeting,  or to receive  payment of such
dividend, or to receive such allotment of rights, or to exercise such rights, as
the case may be,  notwithstanding  any transfer of any stock on the books of the
Company after any such record date fixed as aforesaid.

                                      * 6 *

     SECTION 9. Rights to Purchase  Securities.  The Company shall not,  without
either the prior  approval  of a  majority  of the total  number of shares  then
issued and  outstanding  and entitled to vote or the receipt by the Company of a
favorable  opinion  issued by a nationally  recognized  investment  banking firm
designated by the Committee of Equity Security Holders of Texaco Inc.  appointed
in the  Company's  jointly  administered  chapter 11 case in the  United  States
Bankruptcy Court for the Southern  District of New York or its last chairman (or
his  designee) to the effect that the  proposed  issuance is fair from a finance
point of view to the  stockholders  of the  Company  issue  to its  stockholders
generally  (i) any  warrant  or other  right to  purchase  any  security  of the
Company,  any  successor  thereto  or any  other  person  or  entity or (ii) any
security of the Company  containing  any such right to purchase,  which warrant,
right or security (a) is  exercisable,  exchangeable  or  convertible,  based or
conditioned  in whole or in part on (I) a change of  control  of the  Company or
(II) the owning or holding of any number or percentage of outstanding  shares or
voting  power or any offer to  acquire  any  number of shares or  percentage  of
voting power by any entity,  individual or group of entities and/or  individuals
or (b) discriminates among holders of the same class of securities (or the class
of securities for which such warrant or right is exercisable or exchangeable) of
the Company or any successor thereto.  The affirmative vote of the holders of at
least a majority of the then outstanding  shares of capital stock of the Company
voting  generally  in the  election of  Directors,  voting  together as a single
class, shall be required to repeal the foregoing provisions.

                                   ARTICLE VII
                                   Fair Price.

     A.  Vote Required for Certain Business Combinations.
         1.   Higher Vote for Certain Business Combinations.  In addition to any
     affirmative vote required by law or the Certificate of   Incorporation, and
     except as otherwise expressly provided in Section B of this Article VII:
              a. any merger or  consolidation  of the Company or any  Subsidiary
         (as  hereinafter  defined)  with  (i) any  Interested  Stockholder  (as
         hereinafter defined) or (ii) any other person (whether or not itself an
         Interested Stockholder) which is, or after such merger or consolidation
         would  be, an  Affiliate  (as  hereinafter  defined)  of an  Interested
         Stockholder; or
              b. any sale, lease, exchange,  mortgage, pledge, transfer or other
         disposition (in one transaction or a series of transactions) to or with
         any   Interested   Stockholder  or  any  Affiliate  of  any  Interested
         Stockholder  of any assets of the Company or any  Subsidiary  having an
         aggregate Fair Market Value of $100 million or more; or
              c. the issuance or transfer by the Company or any  Subsidiary  (in
         one transaction or a series of  transactions)  of any securities of the
         Company  or  any  Subsidiary  to  any  Interested  Stockholder  or  any
         Affiliate  of  any   Interested   Stockholder  in  exchange  for  cash,
         securities  or other  property  (or a  combination  thereof)  having an
         aggregate Fair Market Value of $100 million or more; or
              d.  the adoption of any plan or proposal for  the  liquidation  or
         dissolution of the Company  proposed by or on behalf of   an Interested
         Stockholder or any Affiliate of any Interested Stockholder; or
              e. any reclassification of securities (including any reverse stock
         split),  or   recapitalization   of  the  Company,  or  any  merger  or
         consolidation  of the Company with any of its Subsidiaries or any other
         transaction  (whether  or not with or into or  otherwise  involving  an
         Interested  Stockholder) which has the effect,  directly or indirectly,
         of increasing the proportionate  share of the outstanding shares of any
         class  of  equity  or  convertible  securities  of the  Company  or any
         Subsidiary  which is directly  or  indirectly  owned by any  Interested
         Stockholder or any Affiliate of any Interested Stockholder;
shall require the affirmative  vote of the holders of at least 80% of the voting
power of the then outstanding shares of capital stock of the Company entitled to
vote  generally  in the  election of  Directors  (the  "Voting  Stock"),  voting
together  as a single  class  (it being  understood  that for  purposes  of this
Article  VII,  each  share of the  Voting  Stock  shall have the number of votes
granted to it pursuant to Article IV of the Certificate of Incorporation).  Such
affirmative vote shall be required  notwithstanding the fact that no vote may be
required,  or  that  a  lesser  percentage  may be  specified,  by law or in any
agreement with any national securities exchange or otherwise.
         2.   Definition   of   "Business   Combination".   The  term  "Business
     Combination"  as used in this  Article VII shall mean any transaction which
     is referred to in any one or more of clauses (a) through (e) of paragraph 1
     of this Section A.
     B.  When Higher Vote is Not Required.  The  provisions of Section A of this
Article VII shall not be applicable to any particular Business Combination,  and
such  Business  Combination  shall  require  only  such  affirmative  vote as is
required by law and any provision of the Certificate of Incorporation, if all of
the conditions specified in either of the following paragraphs 1 and 2 are met:
         1.   Approval  by  Disinterested  Directors.  The  Business Combination
     shall  have  been  approved  by a  majority  of the Disinterested Directors
    (as hereinafter defined).
         2.   Price and Procedure Requirements. All of the  following conditions
    shall have been met:
              a. The aggregate  amount of the cash and the Fair Market Value (as
         hereinafter defined) as of the date of the consummation of the Business
         Combination of  consideration  other than cash to be received per

                                      * 7 *
<PAGE>


         share  by holders of Common  Stock in such  Business  Combination shall
         be at  least equal to the higher of the following:
                  (i) (if applicable) the highest per share price (including any
              brokerage  commissions,  transfer  taxes and  soliciting  dealers'
              fees) paid by the Interested  Stockholder for any shares of Common
              Stock  acquired by it (a) within the two-year  period  immediately
              prior to the first publication announcement of the proposal of the
              Business  Combination  (the  "Announcement  Date")  or  (b) in the
              transaction   in  which  it  became  an  Interested   Stockholder,
              whichever is higher; and
                  (ii) the Fair  Market  Value per share of Common  Stock on the
              Announcement   Date  or  on  the  date  on  which  the  Interested
              Stockholder became an Interested  Stockholder (such latter date is
              referred  to in this  Article  VII as the  "Determination  Date"),
              whichever is higher.
              b. The  aggregate  amount of the cash and the Fair Market Value as
         of  the  date  of  the  consummation  of the  Business  Combination  of
         consideration  other than cash to be  received  per share by holders of
         shares of any other class of outstanding Voting Stock shall be at least
         equal to the  highest  of the  following  (it being  intended  that the
         requirements  of this  paragraph  2b shall be  required  to be met with
         respect to every class of outstanding Voting Stock,  whether or not the
         Interested   Stockholder  has  previously  acquired  any  shares  of  a
         particular class of Voting Stock):
                  (i) (if applicable) the highest per share price (including any
              brokerage  commissions,  transfer  taxes and  soliciting  dealers'
              fees) paid by the  Interested  Stockholder  for any shares of such
              class of Voting  Stock  acquired  by it (a)  within  the  two-year
              period  immediately  prior to the Announcement  Date or (b) in the
              transaction   in  which  it  became  an  Interested   Stockholder,
              whichever is higher;
                  (ii) (if applicable) the highest preferential amount per share
              to which the  holders of shares of such class of Voting  Stock are
              entitled in the event of any voluntary or involuntary liquidation,
              dissolution or winding up of the Company; and
                  (iii)  the  Fair  Market  Value  per  share  of  such class of
              Voting  Stock  on the  Announcement  Date or on the  Determination
              Date, whichever is higher.
              c.  The  consideration  to be received by holders of a  particular
         class of outstanding Voting Stock (including Common Stock) shall be  in
         cash or in the same form as the Interested  Stockholder  has previously
         paid for  shares  of any  class  of  Voting  Stock.  If the  Interested
         Stockholder  has  paid for  shares of any class of  Voting  Stock  with
         varying forms of  consideration,  the form  of  consideration  for such
         class of Voting Stock  shall be either cash or the form used to acquire
         the largest number of shares of  such Class of Voting Stock  previously
         acquired by it.  The price  determined in accordance with paragraphs 2a
         and 2b of this Section B shall be subject to appropriate adjustment in
         the event  of any stock dividend, stock split, combination of shares or
         similar event.
              d.  After such  Interested  Stockholder  has become an  Interested
         Stockholder and prior to the consummation of such Business Combination:
         (i) except as approved by a majority  of the  Disinterested  Directors,
         there shall have been no failure to declare and pay at the regular date
         therefor any full quarterly  dividends  (whether or not  cumulative) on
         the  outstanding  Preferred  Stock;  (ii) there  shall have been (a) no
         reduction  in the annual  rate of  dividends  paid on the Common  Stock
         (except as necessary to reflect any  subdivision  of the Common Stock),
         except as approved by a majority of the  Disinterested  Directors,  and
         (b) an  increase  in such  annual rate of  dividends  as  necessary  to
         reflect  any  reclassification  (including  any reverse  stock  split),
         recapitalization,  reorganization or any similar  transaction which has
         the effect of reducing the number of  outstanding  shares of the Common
         Stock unless the failure so to increase such annual rate is approved by
         a majority of the  Disinterested  Directors;  and (iii) such Interested
         Stockholder   shall  have  not  become  the  beneficial  owner  of  any
         additional  shares of Voting  Stock  except as part of the  transaction
         which  results in such  Interested  Stockholder  becoming an Interested
         Stockholder.
              e.  After such  Interested  Stockholder  has become an  Interested
         Stockholder,  such Interested  Stockholder  shall not have received the
         benefit,   directly  or  indirectly   (except   proportionately   as  a
         stockholder),  of any  loans,  advances,  guarantees,  pledges or other
         financial  assistance  or any  tax  credits  or  other  tax  advantages
         provided by the Company,  whether in  anticipation  of or in connection
         with such Business Combination or otherwise.
              f. A  proxy  or  information  statement  describing  the  proposed
         Business  Combination  and  complying  with  the  requirements  of  the
         Securities   Exchange  Act  of  1934  and  the  rules  and  regulations
         thereunder (or any subsequent  provisions  replacing such Act, rules or
         regulations)  shall be mailed to public  stockholders of the Company at
         least 30 days prior to the  consummation  of such Business  Combination
         (whether or not such proxy or  information  statement is required to be
         mailed pursuant to such Act or subsequent provisions).
     C. Vote  Required for Certain Stock  Repurchases.  In addition to any other
requirement of the Certificate of  Incorporation,  the  affirmative  vote of the
holders  of  at  least  50%  of  the  Voting  Stock  (other  than  Voting  Stock
beneficially owned by a Selling Stockholder (as hereinafter defined)),  shall be
required before the Company

                                      * 8 *
<PAGE>

purchases  any  outstanding  shares of Common  Stock at a price above the Market
Price (as hereinafter defined) from a person actually known by the Company to be
a Selling  Stockholder,  unless the  purchase  is made by the Company (a) on the
same terms and as a result of an offer made  generally  to all holders of Common
Stock or (b) pursuant to statutory appraisal rights.
         D.   Certain Definitions.  For the purpose of this Article VII:
              1.  A "person" shall mean any  individual,  firm, c orporation  or
         other entity.
              2.  "Interested Stockholder" shall mean any person (other than the
         Company or any Subsidiary) who or which:
                  a.  is the beneficial owner,  directly or indirectly,  of more
              than 20% of the voting power of the outstanding Voting Stock; or
                  b.  is an  Affiliate  of the Company  and at any  time  within
              the  two-year  period  immediately  prior to the date in  question
              was the beneficial  owner,  directly or indirectly, of 20% or more
              of the voting power of the then  outstanding Voting Stock; or
                  c. is an assignee of or has otherwise  succeeded to any shares
              of Voting Stock which were at any time within the two-year  period
              immediately  prior to the date in question  beneficially  owned by
              any Interested Stockholder, if such assignment or succession shall
              have  occurred  in  the  course  of a  transaction  or  series  of
              transactions not involving a public offering within the meaning of
              the Securities Act of 1933.
              3.  A person shall be a "beneficial owner" of any Voting Stock:
                  a.  which such person or any of its Affiliates or Associates
              (as hereinafter defined) beneficially owns directly or indirectly;
              or
                  b. which such person or any of its  Affiliates  or  Associates
              has (i) the right to acquire  (whether  such right is  exercisable
              immediately  or only after the  passage of time),  pursuant to any
              agreement,  arrangement or  understanding  or upon the exercise of
              conversion  rights,  exchange  rights,  warrants  or  options,  or
              otherwise,  or (ii) the right to vote  pursuant to any  agreement,
              arrangement or understanding; or
                  c. which are beneficially  owned,  directly or indirectly,  by
              any other  person with which such person or any of its  Affiliates
              or Associates has any agreement,  arrangement or understanding for
              the purpose of  acquiring,  holding,  voting or  disposing  of any
              shares of Voting Stock.
              4.  For  the  purposes  of  determining  whether  a  person  is an
         Interested  Stockholder  pursuant to paragraph 2 of this Section D, the
         number of shares of Voting Stock deemed to be outstanding shall include
         shares deemed owned through  application of paragraph 3 of this Section
         D but shall not include any other shares which may be issuable pursuant
         to any  agreement,  arrangement or  understanding,  or upon exercise of
         conversion rights, warrants or options, or otherwise.
              5. "Affiliate" or "Associate"  shall have the respective  meanings
         ascribed  to  such  terms  in  Rule  12b-2  of the  General  Rules  and
         Regulations under the Securities  Exchange Act of 1934, as in effect on
         January 1, 1988.
              6.  "Subsidiary"  means any corporation of which a majority of any
         class of equity  security  is owned,  directly  or  indirectly,  by the
         Company; provided,  however, that for the purposes of the definition of
         Interested  Stockholder set forth in paragraph 2 of this Section D, the
         term "Subsidiary"  shall mean only a corporation of which a majority of
         each class of equity security is owned, directly or indirectly,  by the
         Company.
              7.  "Disinterested  Director"  means  any  member  of the Board of
         Directors who is unaffiliated with the Interested Stockholder and was a
         member of the Board of Directors  prior to the time that the Interested
         Stockholder  became an Interested  Stockholder,  and any successor of a
         Disinterested   Director  who  is  unaffiliated   with  the  Interested
         Stockholder and is recommended to succeed a Disinterested Director by a
         majority of Disinterested Directors then on the Board of Directors.
              8. "Fair  Market  Value"  means (a) in the case of the stock,  the
         highest  closing  sale  price  during  the  30-day  period  immediately
         preceding  the  date in  question  of a  share  of  such  stock  on the
         Composite Tape for the New York Stock  Exchange-Listed  Stocks,  or, if
         such  stock is not listed on such  Exchange,  on the  principal  United
         States securities exchange registered under the Securities Exchange Act
         of 1934 on which such stock is listed,  or, if such stock is not listed
         on any such exchange, the highest closing bid quotation with respect to
         a share of such stock during the 30-day  period  preceding  the date in
         question  on the  National  Association  of  Securities  Dealers,  Inc.
         Automated  Quotations  System or any system  then in use, or if no such
         quotations are available, the fair market value on the date in question
         of a share of such stock as  determined  by the Board of  Directors  in
         good faith;  and (b) in the case of property  other than cash or stock,
         the fair  market  value of such  property  on the date in  question  as
         determined by a majority of the Disinterested Directors.
              9.  "Selling  Stockholder"  means any  person  who or which is the
         beneficial  owner of in the aggregate  more than 1% of the  outstanding
         shares of Common  Stock  and who or which  has  purchased  or agreed to

                                      * 9 *
<PAGE>

         purchase any of such shares within the most recent  two-year period and
         who sells or proposes to sell Common Stock in a  transaction  requiring
         the affirmative vote provided for in Section C of this Article VII.

              10.  "Market  Price" means the highest sale price on or during the
         period of five trading days immediately  preceding the date in question
         of a share of such  stock  on the  Composite  Tape  for New York  Stock
         Exchange-Listed  Stock, or if such stock is not quoted on the Composite
         Tape on the New York Stock Exchange, or, if such stock is not listed on
         such  Exchange,  on the  principal  United States  securities  exchange
         registered  under the  Securities  Exchange  Act of 1934 on which  such
         stock is listed,  or, if such stock is not listed on any such exchange,
         the highest  closing bid quotation  with respect to a share of stock on
         or during the period of five trading  days  immediately  preceding  the
         date in question on the National  Association  of  Securities  Dealers,
         Inc.  Automated  Quotations  System or any system then in use, or if no
         such  quotations  are  available,  the fair market value on the date in
         question  of a share of such stock as  determined  by a majority of the
         Disinterested Directors.

     E. Powers of the Board of Directors. A majority of the Directors shall have
the power and duty to  determine  for the  purposes of this  Article VII, on the
basis of  information  known to them after  reasonable  inquiry,  (1)  whether a
person is an  Interested  Stockholder,  (2) the number of shares of Voting Stock
beneficially  owned by any  person,  (3)  whether  a person is an  Affiliate  or
Associate  of  another,  (4)  whether  the assets  which are the  subject of any
Business  Combination have, or the consideration to be received for the issuance
or  transfer of  securities  by the Company or any  Subsidiary  in any  Business
Combination  has, an  aggregate  Fair Market  Value of $100  million or more.  A
majority of the  Directors  shall have the further power to interpret all of the
terms and provisions of this Article VII.

     F.  No Effect on Fiduciary Obligations of Interested  Stockholders. Nothing
contained  in this  Article VII shall be  construed  to relieve  any  Interested
Stockholder from any fiduciary obligation imposed by law.

     G. Amendment,  Repeal,  etc.  Notwithstanding  any other  provisions of the
Certificate of Incorporation or these by-laws (and notwithstanding the fact that
a lesser percentage may be specified by law, the Certificate of Incorporation or
these  by-laws)  the  affirmative  vote of the holders of at least a majority of
then outstanding  shares of capital stock of the Company voting generally in the
election of  Directors,  voting  together as a single class shall be required to
repeal the foregoing provisions of this Article VII.

                                  ARTICLE VIII.
                                      Seal.

     The seal of the Company  shall be in circular form  containing  the name of
the Company around the margin,  with a five pointed star in the center embodying
a capital "T".

                                   ARTICLE IX.
                               By-Law Amendments.

     Subject  to the  provisions  of the  Certificate  of  Incorporation,  these
by-laws  may be  altered,  amended or  repealed  at any  regular  meeting of the
stockholders (or at any special meeting thereof duly called for that purpose) by
a majority vote of the shares  represented and entitled to vote at such meeting;
provided that in the notice of such special meeting notice of such purpose shall
be given.  Subject  to the laws of the State of  Delaware,  the  Certificate  of
Incorporation and these by-laws,  the Board of Directors may by majority vote of
those present at any meeting at which a quorum is present  amend these  by-laws,
or enact  such other  by-laws  as in their  judgment  may be  advisable  for the
regulation of the conduct of the affairs of the Company.



                                      * 10 *